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Marketplace Scratch Pad

Google and evil

Scott Jagow Jul 8, 2009

Kai Ryssdal recently spent some time at the Aspen Ideas Festival, and specifically, he spent an hour interviewing Google CEO Eric Schmidt. There was a small portion on Marketplace yesterday, but there’s much more to the interview.

Here’s a link to the entire transcript, and you can watch the interview below, but I’ll highlight a few snippets:

On Google’s future:

Ryssdal: Now that your company has become as omnipresent as it has and as interwoven in our lives as it has, what do you do to keep it there, to keep us as dependant on you as we are?

Schmidt: Hopefully, it’s not dependant upon you. Hopefully, it’s because you come to Google because we do amazing things. Normally in the valley, in Silicon Valley, companies have one great product idea that, as the company gets older, it gets slow and it gets complicated and then a new upstart idea comes along that outpaces them. So that’s the story about Silicon Valley. So we designed Google so that we would be innovative inside of ourselves at any size and scale. Now let’s hope that this continues. We’re organized around something that’s called 20 percent time which means that engineers can spend roughly one day a week, or 20 percent of their working time, which is a lot, to work on things that they find interesting. Most of our new ideas come from that 20 percent time. What will happen is an engineer will come up to me and say, “I have to show you a demo. You have to see it and you have to see it right now!”

On advertising as Google’s major source of revenue:

Ryssdal: You guys get though 97 percent of your revenue from advertising.

Schmidt: Yes.

Ryssdal: I can’t believe that at a board meeting or two some board member hasn’t come over to you and said, “Hey Eric, 97 percent is a lot of eggs in one basket!”

Schmidt: What’s funny about it is that not only do they do it at one board meeting, they do it at every board meeting.

Ryssdal: And probably several board members, right?

Schmidt: Of course. The good news is that if you are going to be in advertising, we’re in the best kind of advertising because it’s targeted advertising, it’s measurable, it’s called return and investment advertising. And frankly if you are going to start a new business out of this recession, the first salespeople you’ll use are the Google Ad Words product because it’s very, very efficient to reach your customers to sell your product. You literally have these little text ads. It’s a remarkably successful business for us and we are very proud of it.

On the perception of Google:

Ryssdal: Do you worry though about that perceived arrogance, I mean there’s a not small group of people out there who think Google is the ‘evil empire’.

Schmidt: Well in the first place we’ve always had the arrogance that you are describing and so we have to accept that it’s part of our culture.

Ryssdal: In the most positive sense I think.

Schmidt: Yeah and arrogance is needed as a leadership model because you have to believe that you could actually change the world in order to attempt it otherwise you would never try. You would just sit around and say, “Oh woe is me.” So we temper it by the reality that we are not perfect, that we make mistakes. We’ve had a series of business failures and not large ones but small ones, which we talk a lot about so we can understand the errors that we’ve made. So while we are not perfect, we are consensus-driven as a company. That’s the reason why I’m a lot of time talking and learning from mistakes that we’ve made.

On Google’s motto:

Ryssdal: I’m going to crib for myself in the conversation we had not too long ago at the Ideas Festival and ask you if “don’t be evil” means “always be good?”

Schmidt: You asked and it’s the best question I’ve had on that in many, many years. We use “don’t be evil” as a way of discussing what to do. We don’t know what the definition of good and evil is but if you see something (if you are an employee) that you think is evil, you’re supposed to say, “Hey, that’s evil!” and discussion is supposed to ensue. Do we really want to cross that line? Are we really getting what we think about? And often we end up in product reviews where somebody’s come up with a product and after we look at it we say, “It’s too tough, it’s too close to the things that people care about, it violates too much privacy, it’s a misuse of information.” Those kinds of things and we stop it.

Ryssdal: And so far we, the consumer have had to trust you, the company to make those decisions. Can you see a time, not ‘do you think it would be a good idea or not’ but can you see a time where the Government might be interested in saying, “You know what? Google, you are too powerful, too instrumental in this economy, we need to regulate you.”

Schmidt: Well I hope that doesn’t happen because you know innovation occurs in private companies, not in governments. If that were to occur and this of course were a hypothetical, I would hope that the regulations would be written in such a way that they weren’t on a per company basis but they were rather about information, and that we would have a debate about the proper role of how information can be used.

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